New Delhi, Mar 13, 2020: Gold prices on Friday crashed by Rs 1,097 to Rs 42,600 per 10 gram in national capital Delhi as investors liquidated everything they could to cover losses in the wake of panic selling over coronavirus outbreak. The yellow metal had closed at Rs 43,697 per 10 gram in the previous session, Hindustan Times reported.
“Gold prices fell further and were on track to post their biggest weekly drop in nearly seven years, as a rout in global equities forced investors to cover margin calls. A significant sell-off in equities would place further pressure on gold as investors would liquidate positions to meet margin calls,” said Navneet Damani, VP, Commodities Research, Motilal Oswal Financial Services.
Silver prices also plummeted by Rs 1,574 to Rs 44,130 per kg from Rs 45,704 per kg on Thursday.
“There is a lot of panic in the market and even safe haven assets are getting ditched to cover losses in the wipeout,” added Damani.
“Gold prices traded volatile on Friday with international spot gold prices hovering near USD 1,585 after witnessing sell-off on Thursday’s evening session,” HDFC Securities Senior Analyst (Commodities) Tapan Patel said. Spot gold for 24 karat in Delhi was trading lower by more than Rs 1,000 on rupee appreciation, said Patel.
Globally, gold was trading higher at USD 1,584 per ounce, while silver quoted lower at USD 15.65 per ounce.
Meanwhile, the Indian rupee staged a recovery in the afternoon session, trading 36 paise higher against the US dollar, after the Reserve Bank stepped in to maintain sufficient liquidity in the panic-stricken currency market.
Equity benchmark indices staged the biggest ever intra-day recovery on Friday after hitting a 10 per cent lower circuit for the first time since 2008 global financial crisis.
After a halt for 45 minutes, the market witnessed sharp recovery when market regulator Securities and Exchange Board of India (SEBI) stepped in to reassure investors.